Sandor Steverink, DeltaLloyd AM

CWG: What was your most stressful day as a fund manager in 2012 and why?

2012 did not bring huge amounts of stress compared to the last few years, where we got used to
bankruptcy of banks and dramatic drops in rates and sovereign bonds. If there was any sign of market
stress, then May 31 was the day that interest rates dropped to record lows and the world looked like one
big Japan.

CWG: Which trade in 2012 do you wish you would have done, but didn’t?

That is an easy one. For a bond investor Italian bonds were the place to be with hindsight and with
an Italian heading the ECB, it was possible to forecast that.

CWG: What’s your New Year’s resolution in fund management?

My New Year’s resolution in fund management is to keep telling my clients about the scenario they do
not want to hear about, but have to be aware of.

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Mike Riddell, M&G Investments

CWG: What was your most stressful day as a fund manager in 2012 and why?

January 20th. Our entire team had spent the last three years being massive bears on the Eurozone, and
especially peripheral Eurozone sovereign and bank debt. Changing a long held structural view is
immensely difficult, and I had been tearing what's left of my hair out for the previous two weeks as I
watched peripheral sovereigns start to rally on the back of the three year LTRO that began in December.

CWG: Which trade in 2012 do you wish you would have done, but didn’t?

I'd have to go for Emerging Europe FX, and specifically the Hungarian Forint, the Polish Zloty and
the Turkish Lira, which have been the three best performing currencies in the world this year. The
currencies and their bond markets confounded expectations and rallied strongly primarily on the back of
enormous hot money flows that were hunting for anything with yield. The stellar performance of these
markets this year hasn't changed my views though and these views are now, if anything stronger - Eastern
Europe in particular is extremely vulnerable to the hot money flowing out again.

CWG: What’s your New Year’s resolution in fund management?

Get fully up to speed with some of the more complex derivative strategies. People normally think
'derivatives' and get scared, but I'm more interested in using derivatives to hedge against some of the
tail risks. After a long period of low volatility, I think markets are being far too complacent about
some extreme outcomes, particularly in the FX markets. Derivatives make it possible to hedge against
extreme outcomes, and if these outcomes actually occur then clients could actually make money.

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Chris Bullock, Henderson GI

CWG: What was your most stressful day as a fund manager in 2012 and why?

Tricky one, but on balance launch day of the new Euro High Yield fund on Nov 19 wins it – launching a
fund is always a relatively stressful experience, even more so if it is in the middle of an illiquid
rallying market!

CWG: Which trade in 2012 do you wish you would have done, but didn’t?

I wish I’d owned more high yield, and for a lot longer (we sold down into Q2 expecting sovereign
concerns to impact the HY market – the rest is history).

CWG: What’s your New Year’s resolution in fund management?

My New Year’s resolution in fund management is to... stop making predictions for the following year,
they’re always wrong, yet we never learn...

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